This document provides an overview of industrial innovation trends and management of technology and innovation. It discusses the history of innovation management from the 1970s to present day, highlighting concepts like concurrent engineering, rapid prototyping, stage-gate processes, strategic alliances, open innovation, and building innovative organizations. The document also examines factors for success and failure in new product development and provides recommendations for making companies more innovative.

1. 1
Industrial innovation
trends
Marko Torkkeli
Professor, Technology and Business
Innovations
Kouvola Research Unit
Prikaatintie 9
FI-45100 Kouvola
www.kouvola.lut.fi
www.openinnovation.fi
Overview
Technology proves to be important
Creation of new ideas
New Product Development
Success and Failure of New Products
Strategic Alliances
The Innovative, Open Company
Quick Scan
70s
80s
90s
00s

2. 2
History of Management Science
Daft & Marcic, Understanding Management, Thomson
Ansoff (1965):
Corporate Strategy
MBA’s: Finance,
Law and Marketing
1970:
Technological
Forecasting and
the Club of Rome
Mid 70s: Creativity, basis for e.g. ISPIM
Envisioning the ‘home computer of the future’ in 2004 by RAND Corp. in
the fifties.

3. 3
Philiform - Philips
80s: Success and Failure in new Product Development
Innovators and Followers (Teece)
Success Failure
Follower
Innovator
IBM
personal computer
KODAK
instant photography
DUPONT
teflon
EMI
scanner

4. 4
Innovators and Followers
Likely failure
Look for a partner
Likely failure
Apply with the
dominant design?
Supplementing
resources available?
Can the intellectual
property be protected?
Likely to succeed
no
no
no
Success Factor Grading
0 2 4 6 8 10 12 14
Superior product
Strong market orientation
International orientation
More predevelopment
Sharp and early product definition
Properly executed launch
Organisational structure and climate
Top management support
Technological and Marketing synergy
Aim at attractive markets
Sharper project selection
Project control / Quality of execution
The resources must be in place
Speed
Stage gate system
Protection of intellectual property
Dominant design
Secure access to Complementary assets
Consumer Innovator / Lead users
Learning
Non-product advantage
SuccessFactors
Number of responses1 Not so important
2 Fairly important
3 Very important

5. 5
Cassette Deck
Development time: two years.
The competitor develops a new deck in just half a year.
Now what?
Solutions:
• Concurrent Engineering
• Modular design and Platform design
• Marketeers and Engineers work together in an
early stage
• Rapid prototyping

6. 6
Stage-Gate according to Cooper
Criteria for selection at the Gates

7. 7
portfolio
management
market knowledge,
local party required
scale,
specialised partner
satisfy a need,
not a demand
R&D, complementary
technology,
share know how
Cooperation in the network economy
2. Access to new markets
3. Efficiency
4. Clients do not want
products, but tailored
solutions
1. Access to knowledge
Access to new markets
Efficiency
Clients do not want
products, but tailored
solutions
Access to knowledge

8. 8
Managing Diversity
• from ‘gold seeking’ to synergy with
market, product/application, technology
soft aspects
• PLUS operations fit
• PLUS cultural, human, strategic fit
• yet complementary in competencies!

9. 9
a. An innovative company should create an
environment of learning and experimenting,
rather than planning.
b. HQ should facilitate the initiatives from
BUs, rather than direct BUs.
c. Venturing is not ‘just’ for getting new business,
but more and more to create new options.
d. Key to getting knowledge and strengthening
own competencies are strategic alliances.
e. Business teams which strongly disagree (yet
believe in a common objective) are more
innovative than a too well structured set up.
How to make a company more innovative?
10 factors for an innovative organisation
• Leadership and will to innovate
• Appropriate structure
• Key individuals
• Effective team
• Streaching individual capabilities
• Extensive communication
• High involvement in innovation
• Customer focus
• Creative climate
• Learning organisation
Joe Tidd et al.,
Managing Innovation,
Wiley, 1997 and on,
Chapter 11: Building
the Innovative
Organization.

10. 10
Copyright Arie Nagel, Netherlands
Copyright Arie Nagel, Netherlands

11. 11
Copyright Arie Nagel, Netherlands
1. Brian Twiss, Managing Technological Innovation, Pitman, Longman, London, 1974, 1980, 1986 and 1992. C, In.
2. Preston G. Smith and Donald G. Reinertsen, Developing Products in Half the Time, New Rules, New Tools, New
York, Van Nostrand Reinhold, 1991. Second ed. in 1998. In.
3. Steven C. Wheelwright and Kim B. Clark, Revolutionizing Product Development, Quantum Leaps in Speed,
Efficiency, and Quality, New York, The Free Press, 1992. In.
4. Gary Hamel and C.K. Prahalad, Competing for the Future, Breakthrough Strategies for seizing control of your
industry and creating the markets of tomorrow, Harvard Business School Press, 1994. C.
5. Stewart Bray, Total Innovation, How to Develop the Products that your Customers want, Pitman Publ./Pearson,
London, 1995. In.
6. Robert A. Burgelman et al. The Strategic Management of Technology and Innovation, 2nd ed., Irwin, 1996. C, R.
7. Robert A. Burgelman , Modesto A. Maidique and Steven C. Wheelwright, Strategic Management of Technology
and Innovation, second ed., Irwin, 2001. C, R.
8. R. G. Cooper, S. J. Edgett, and E. J. Kleinschmidt, Portfolio Management for New Products, Hamilton, Ontario,
McMaster University, 1997. In.
9. Joe Tidd et al., Managing Innovation, Integrating Technological, Market and Organizational Change, Wiley, 1997.
Second ed. 2001. C.
10. Robert G. Cooper: Winning at New Products, Accelerating the Process from Idea to Launch, Addison-Wesley,
1993. Third ed. in 2001. In.
11. V.K. Narayanan, Managing Technology and Innovation for Competitive Advantage, Prentice-Hall, 2001. C.
12. Henry Chesbrough, Open Innovation: The New Imperative for Creating and Profiting from Technology, Boston,
MA, Harvard Business School Press, 2003. C.
13. David Probert et al., Bringing Technology and Innovation into the Boardroom, Strategy, Innovation and
Competences for Business Value, European Institute for Technology and Innovation
Management/Palgrave/MacMillan, 2004. C, R.
14. Melissa A. Schilling: Strategic Management of Technological Innovation, McGraw-Hill/Irwin, New York, 2005. C.
Some useful books: Conceptual (C), Instrumental (In), Reader (R)